Phone-hacking scandal at Murdoch-owned British paper leads to high-level resignations
By Paul Farhi and Anthony Faiola,
LONDON — Two key lieutenants in Rupert Murdoch’s media empire resigned Friday as a widening scandal involving illegal phone hacking by Murdoch’s British newspaper journalists continued to engulf his company.
Leslie “Les” Hinton, head of Dow Jones & Co., the division of Murdoch’s News Corp. that owns the Wall Street Journal, resigned late in the day, providing a bookend to the morning resignation of Rebekah Brooks, the executive in charge of the company’s British newspaper unit.
Hinton, who had been in Murdoch’s employ for more than 50 years, and Brooks are key figures in the still-unfolding scandal. Hinton oversaw News Corp.’s British newspapers when one of its papers, the News of the World, began to pry into the phone accounts of hundreds of British celebrities, politicians and ordinary citizens. Brooks was editor of the News of the World at the time and succeeded Hinton as chief of the British unit, News International.
Murdoch had stood by both executives as details of the hacking began to emerge, first in 2005 and particularly in the past 10 days, with revelations that the hacking was far more widespread than anyone at News Corp. had admitted. The furor in Britain over it led News Corp. to shutter News of the World last week and scuttled its $12 billion bid to take over a satellite TV company, British Sky Broadcasting.
Murdoch has described Brooks, 43, as like a daughter to him and had refused to accept her resignation several times. On Friday, however, she resigned, saying she had become a focal point of the scandal in a way that was jeopardizing the company.
Hinton, 67, is the first U.S. executive to lose his job as a direct result of the crisis. A onetime newspaper copy boy whose duties included fetching young Rupert Murdoch’s lunch, he said in a statement Friday that he was “ignorant of what apparently happened.” He apologized for the hurt caused by News of the World and called it “a deeply, deeply sad day for me.”
Hinton testified twice before parliamentary committees looking into the affair, in 2007 and 2009. He assured lawmakers on both occasions that the hacking was limited to one rogue reporter and a private investigator hired by the paper.
Brooks has admitted that News of the World journalists paid bribes to police to obtain information. But she, like Hinton, had said she was unaware of the extent of the hacking when she was running the paper and editing the scoops the illegal prying produced.
The dual resignations appeared to be part of News Corp.’s strategy to contain the most serious crisis in Murdoch’s nearly six decades as a dealmaker and global media baron. The pressure on Murdoch is likely to peak on Tuesday, when he and his son James, and perhaps Brooks, are scheduled to testify before Parliament about what they knew and what they did about it. James Murdoch is the chairman of News International and is widely considered the heir apparent to run News Corp., the world’s second-largest media-entertainment conglomerate after the Walt Disney Co.
Rupert Murdoch is being advised by three Washington lawyers with long experience in high-profile fights: Brendan V. Sullivan Jr. of the famed Williams & Connolly firm, who defended Oliver L. North in the Iran-Contra affair; Georgetown Law professor Viet D. Dinh, a former legal adviser to President George W. Bush who was instrumental in writing the USA Patriot Act; and former Justice Department official and New York City schools chief Joel Klein.
In addition to accepting Hinton’s and Brooks’s resignations, Murdoch on Friday met with and apologized to the family of Milly Dowler, the murdered British schoolgirl whose cellphone was hacked by an investigator working for News of the World. Revelations by the Guardian newspaper last week that Dowler had been targeted — and that the paper had deleted one of her voice-mail messages while she was still missing — brought widespread condemnation to News Corp., including from British Prime Minister David Cameron.
News Corp. will also run ads in Britain’s national newspapers apologizing for its conduct. The ads, headlined, “We Are Sorry,” are signed by Murdoch.
In an internal memo released by the company, Brooks wrote, “At News International we pride ourselves on setting the news agenda for the right reasons. Today we are leading the news for the wrong ones. The reputation of the company we love so much, as well as the press freedoms we value so highly, are all at risk.”
Cameron, a personal friend of Brooks, and British opposition Labor Party leader Ed Miliband had called for Brooks’s resignation, saying she should take responsibility for the poor handling of the scandal, in which Scotland Yard officials have said that News Corp. officials have been uncooperative.
Hinton’s replacement at New York-based Dow Jones hasn’t been named, but the likely candidate is American Todd Larsen, its president. Tom Mockridge, a New Zealand native who previously headed News Corp.’s Sky Italia operation, will replace Brooks, the company said.
Brooks, a well-known and well-connected figure in London media and political circles, conceded in her resignation statement that she had become a lightning rod for the company. “I have believed that the right and responsible action has been to lead us through the heat of the crisis,” she said. “However my desire to remain on the bridge has made me a focal point of the debate.”
Cameron welcomed her resignation, saying through a spokesman that “it was the right thing to do.” Miliband also hailed the news but added that News Corp. still has explaining to do.
The spotlight is likely to turn more intensely on James Murdoch, who was Brooks’s boss. The younger Murdoch has admitted to approving out-of-court payments to people who had threatened to sue News International for invasion of privacy. He said later that he didn’t have a full picture of the illicit activity when he approved the payments, which have been called “hush money” by a number of commentators.
In an interview late Thursday with the Wall Street Journal, Rupert Murdoch strongly defended his son’s handling of the crisis, saying that he had managed the situation “as fast as he could” and that the scandal would not affect his position at the company. By Friday, when he met with Dowler’s family, his tone was markedly more apologetic.
Andrew Russell, professor of politics at the University of Manchester, said the resignations are “an example of how this whole episode is running through the organization. I was of the opinion that Rebekah Brooks didn’t go immediately because in the end, the longer she stayed, the more likely it would be that her departure would be the end of the process. But now that Les is gone, too, the whole organization seems to be turning into chaos.” He added, “One thing that is for sure is that every day, the hole just looks deeper and murkier for this company. It’s hard to see a manageable outcome.”
Farhi reported from Washington.